By Angel Versetti, CEO of Ambrosus
It can be said that food safety standards within supply chains are in a deadlock. While we have seen increased counterfeiting and product fraud, new standards, traceability requirements and health standards are now being introduced in Europe and North America. We have already seen this narrative, with legislation such as the law on the modernization of food security of 2011 in the United States or the recent guidelines of the European Commission on the "Good practices of distribution of medicinal products for human use". On the other hand, most of the supply chain records are still kept on paper, from product identification numbers and from evidence of regulatory compliance to product lot information, which may make organization difficult and sharing with third parties.
It is at this juncture that blockchain and the Internet of Things (IoT) – two of the most innovative technologies of the fourth industrial revolution – are able to merge one another to revolutionize internal traceability practices. supply chains and radically improve food safety standards. In context, both blockchain technology and IoT solutions focus on data collection and management, which includes bits of information extracted from physical or biological materials. Likewise, both technologies make it possible to digitize information on a platform where multiple parties can access and share information in a secure and transparent manner.
Specifically, IoT refers to the wide range of intelligent devices that are able to bridge the gap between the physical and the digital world: environmental, biological and chemical-based sensors can be linked to any specific process or product (for example a tree on a farm). These devices then collect information about the product to which they are connected and transmit real-time conditions to another device or to a central gateway connected to a larger network. To complete the IoT, a blockchain works like a distributed ledger that is able to receive information from these devices. This information is then publicly verified in order to ensure that no data can be changed; it stores and eventually displays this information for a third party or the final consumer.
The intrinsic value of IoT to blockchain is that it could provide a means to store data trustfully: once loaded, the data can not be easily modified or modified. When applied together, blockchain and IoT can ensure secure, end-to-end data collection, transmission, validation and archiving in the physical world.
When applied to supply chains, particularly those that carry high-value or easily spoiled goods, blockchain and IoT are technologies capable of redefining food-quality standards, providing consumers with an additional level of transparency and confidence in the quality of their product. In cold chain logistics, for example, meat and other foods must always be stored and transported at a specific temperature. Using the blockchain and IoT, sensors can be used to transmit information on the real-time conditions of these foods as they travel from one point to another in the supply chain. The data can then be stored on the blockchain and linked to a mobile or web application, where a consumer can check with his smartphone that the product is of good quality.
Looking beyond the consumer, governments and other legal authorities are slowly becoming aware of the benefits that blockchain and IoT can offer in terms of managing food safety standards within a legal jurisdiction. For the first time, blockchain and IoT provide a means by which product information related to a particular food or beverage can be managed in such a way that its origin and the path along a supply chain can be safely integrated into a single data stream. In addition to traceability, data transmitted by an IoT device (for example related to the origin and health conditions of a fish shipment) can also be used for insurance, tax and regulatory compliance purposes once they are protected in safe way on a blockchain.
In general, blockchain and IoT provide an integrated solution for managing product data as they travel along the supply chain. With IoT, a number of external variables (temperature, position, acceleration) and internal variables (pH levels, enzymatic testing, product purity) that surround a product are digitized for the first time. With blockchain, the ability to securely and transparently store and share data on supply chain products becomes a reality. In the future, as the two technologies continue to develop, consumers will become more aware of the quality of their products, while widespread food security reforms promise to prevent fraud and allow only the sale of the best products on the market.